Bangladeshi authorities have denied that Islamic State is behind the cafe attack which left 28 people dead.

The terrorist group had originally claimed responsibility after gunmen entered a restaurant in Dhaka and killed many of their mostly non-Muslim hostages before police stormed the building after a 12-hour standoff.

According to witnesses, they had killed anyone who was unable to recite verses from the Koran, hacking most of them to death with machetes and leaving their bodies on the floor.

Among their victims were Italians, Japanese, an American, an Indian and at least three Bangladeshis.

Deputy Inspector General of Police Shahidur Rahman said that seven of the gunmen were Bangladeshi and were mostly educated and from well-off families.

Bangladesh Home Minister Asaduzzaman Khan told Reuters that the men were not from Islamic State or al Qaeda, instead blaming JMB - Jamaat-ul-Mujahideen Bangladesh.

JMB claims to represent Islamic State in Bangladesh but any links between the two groups have not been proven.

National police chief Shahidul Hoque said all the gunmen were Bangladeshis, adding: "Five of them were listed as militants and law enforcers made several drives to arrest them."

Meanwhile, a police officer treated for gunshot wounds spoke from his hospital bed about the attacks.

Pradip, a 30-year-old officer who gave only one name, said he had rushed to the scene to find a blood-smeared man lying in front of the restaurant shouting: "Save me, save me."

The police officers were then targeted by the gunmen from inside the restaurant.

Pradip said: "At some point, I felt blood was rolling down my cheek.

"We did respond with fire and the attackers stopped. We then rescued the man, who was the driver of some of the Japanese citizens who were inside."

The Dhaka attack was the worst since 2005, when JMB set off a series of bombs in the country over the space of an hour, killing at least 25 people, mostly judges, police officers and journalists.

Six JMB leaders were executed in March 2007 and police still hunt the group's members, often relying on tips from the public.

A majority of the 160 million people in Bangladesh are Muslim and the country has seen increasing violence from various groups.

Islamic State has claimed responsibility for a number of attacks since its first in the country in September.

An Italian missionary survived after being shot in the neck in November.

Another Italian and a Japanese citizen were killed in attacks at the end of September and early October last year.

(Sky News)